Software developer Vincent Van Code believes the proposed CLARITY Act could have a bigger impact on $XRP adoption than many people expect.
He argues that, although $XRP’s legal status is clearer today, important regulatory uncertainty still remains.
In a post on X, Van Code said the 2023 district court ruling in the SEC’s case against Ripple significantly reduced legal uncertainty. Notably, the court found that $XRP sales on secondary markets are not securities.
He said the ruling has already encouraged more institutional activity. It has supported the expansion of Ripple’s On-Demand Liquidity (ODL) corridors, bank pilot programs, $XRP exchange-traded fund (ETF) filings, and broader custody support.
Court Ruling Reduced Risk, but Uncertainty Remains
Van Code argued that the Ripple decision is still only a federal district court ruling, not a federal law. Because of that, he said, future legal and regulatory challenges remain possible.
He noted that the SEC could take different positions in future enforcement actions. Future court decisions or changes in administration could also narrow or revisit the ruling.
According to Van Code, this uncertainty continues to concern large financial institutions. Many of them require clear statutory guidance before committing significant capital or integrating digital assets into core financial products.
CLARITY Act Could Encourage More Institutions
Van Code said the CLARITY Act is designed to address this issue by putting digital asset classifications into federal law.
He added that banks and traditional financial institutions generally follow conservative compliance standards. As a result, many remain hesitant to hold large $XRP positions or build major products based only on a court ruling.
Instead, some institutions have limited their $XRP involvement to lower-risk activities. These include non-custodial services, pilot programs, and experimental use cases.
If passed, the CLARITY Act could remove much of the remaining regulatory uncertainty that risk-averse institutions continue to cite. Van Code believes this could support broader institutional adoption of $XRP.
However, he emphasized that this is his personal analysis. He did not suggest that the legislation would necessarily have a direct impact on $XRP’s market price.
CLARITY Act Advances in Senate
A new draft of the Digital Asset Market Clarity Act is circulating in the Senate as lawmakers make a final push to pass crypto market structure legislation before the August recess.
The latest draft includes a controversial ethics provision. It would bar the president and other senior government officials from holding direct crypto investments until 2029. The Department of Justice would be responsible for enforcing the rule.
Republicans say the provision reflects an agreement with President Donald Trump. However, many Democrats argue the restriction does not go far enough. Several have not yet committed to supporting the bill.
Beyond the ethics measure, the legislation would expand consumer protections and clarify how digital assets are regulated. It would also establish rules for crypto exchanges, support tokenized securities, and preserve protections for decentralized finance (DeFi) developers. Developers who do not control customer funds would remain exempt from money transmitter rules.
Republican leaders are expected to bring the bill to the Senate floor soon. However, it will likely need at least 10 Democratic votes to clear the Senate’s 60-vote threshold.
With Congress set to begin its summer recess in August, the coming weeks are the bill’s best opportunity to advance.
